How dysfunctional policy can lead to a massive stock market rally AND a declining economy

The latest bank loan and deposit data shows the absurd level of Federal Reserve produced bank deposits relative to loans. What to do with excess deposits? Speculate, of course. This is where a great deal of the inflation has gone – into the stock market. Here is the data Meanwhile, the real economy is starved of healthy finance. As a result, despite extraordinary “stimulus” for over 4 years, the economy continues to struggle. The independent business survey, NFIB index, has been signaling recession for some time already. Now the larger national ISM data has fallen to the worst level since 2009. Here is a summary of this mornings data